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China Property

China’s property market has surged in recent years. After prices jumped 25 per cent in 2009 alone, the central government imposed austerity measures, including lending curbs, higher mortgage rates and restrictions on the number of homes each family can buy.

Renewed tightening measures by the central government to curb the real estate sector hit both mainland and Hong Kong markets yesterday as investors rushed to clear their positions on fears that the new policies could choke off sales.

Mainland media have dubbed a generation of middle class "fang nu", or housing slaves, a reference to the lifetime of work they needed to pay off their debts. They are taking on mortgages even as Beijing maintains property curbs to damp prices that have almost tripled since the mainland embarked in 1998 on a drive to increase private home ownership.

Data from the China Index Academy shows that the average price of a new home in 100 major cities recorded an eighth successive month-on-month rise in January, to 9,812 yuan (HK$12,190) per square metre, up 0.03 per cent from December.

After showing early signs of a pickup last fall, online real estate services firm Soufun is sending even stronger signals that springtime may indeed be coming for companies that make their money from buying and selling activity in the property market.

Municipal governments of Shanghai and Chongqing imposed the taxes early in 2011 to cool the market, but in Shanghai prices rose by over 7 per cent last year and in Chongqing prices recovered from a lull in 2011 to surge by 6 to 8 per cent in the second half of last year.

The state banking watchdog is launching an investigation into a former Shanxi bank official after she was accused of using a double residence loophole to buy properties worth millions of yuan, the Beijing Times reported on Saturday.

Shares of China Vanke rose their 10 per cent daily limit yesterday after the country's largest developer by market value announced plans to move trading of its foreign-currency shares to Hong Kong from Shenzhen.